Tuesday, June 02, 2015

Worse, we begin as stereotypical welfare
recipients. We first cause pain to our primary donor, Mom, then we get out
there in the world and proceed to make impossible demands, stay up late at
night and cause others to stay up late, never work, get addicted first to milk
and then often to sugary substances. And all the while we complain complain
complain.

Of course, this is a modern phenomenon. It used
to be that many of us would get out there and start working when we were four.
And of course it used to be that our death rate was in the 60 percent.

My point is that economists are generally so
blind to the real material conditions of everyday life that they are quite
comfortable treating generations as independent variables. Thus, we are
supposed to think that the young have
interests opposed to the old, and so on. The production of these pseudo social
categories is an invidious effect of the economist's disease - methodological
individualism. Of course, once you have your pseudo social categories, you can
mount your pseudo social movement, which explainst the perpetual libertarian
thirty something push to cut social security because it hurts "young
people." The people who do this kind of thing, on closer examination, are
almost always products of terrific family benificence. They never give a
worried thought about what to do with the parents when they get old, since the
parents have already bought the cruise ship tickets and the time share in Costa
Rico.

In reality, the economic lives of the young and
the old are inextricably mixed in these things called families.

Without seeing families as anything other than individual
agents puzzlingly tied together through long term contracts that the smart
young person will renegotiate after consultation with an accountant, you'll
never understand economic life in, well, the real world. Almost all Gary Becker
like schemas, which map cost to benefit as though we were all University of
Chicago ants, are thus bound to fail.

A recent column by
Paul Krugman cited a Pew Poll about financial security:

We learn, for example, that 3 in 10 nonelderly Americans said
they had no retirement savings or pension, and that the same fraction reported
going without some kind of medical care in the past year because they couldn’t
afford it. Almost a quarter reported that they or a family member had
experienced financial hardship in the past year.

And something that even startled me: 47 percent said that they
would not have the resources to meet an unexpected expense of $400 — $400! They
would have to sell something or borrow to meet that need, if they could meet it
at all.

Where do you think that 47 percent goes to when
they need to cover that expense? The local bank? No, the gap is covered by parents,
grandparents, siblings or children for the most part. Although American family
structure is notoriously weakly linked, I believe the trend is to stronger links,
for various obvious reasons: the immensely cheaper logistics of keeping
connected, the stagnation in upward social mobility, the erosion of the WASP
model of family, which leans heavily on do it yourself. The frontier is dead – you
can jam it up Davy Crockett’s ass, because it is done. Facebook is only the
latest in the series of avatars that killed it and killed it. So we don’t have
large groups of people disappearing to homestead in some desert and writing the
family one or two letters a year.

I would guess that interfamily shifts in money
are what has kept Americans afloat in the age of the Great Slump. But
economists can’t even begin to see this until they start seeing something more
than human pixels accruing capital.

About Me

MANY YEARS LATER as he faced the firing squad, Roger Gathman was to remember that distant afternoon when his father took him to discover
ice. Or rather, to discover the profit making potential of selling bags of ice to picnicking Atlantans, the most glorious of the old man's Get Rich schemes, the one that devoured the most energy, the one that seemed so rational for a time, the one that, like all the others - the farm, the housebuilding business, the plastic sign business, chimney cleaning, well drilling, candy machine renting - was drawn by an inexorable black hole that opened up between skill and lack of business sense, imagination and macro-economics, to blow a huge hole in the family savings account. But before discovering the ice machine at 12, Roger had discovered many other things - for instance, he had a distinct memory of learning how to tie his shoes. It was in the big colonial, a house in the Syracuse metro area that had been built to sell and that stubbornly wouldn't - hence, the family had moved into it. He remembered bending over the shoes, he remembered that clumsy feeling in his hands - clumsiness, for the first time, had a habitation, it was made up of this obscure machine, the shoe, and it presaged a lifetime of struggle with machine after machine.